The discussion and analysis of our financial condition and results of operations that follow are based on Audited Consolidated Financial Statements of Embassy REIT and the REIT assets/ SPVs/holdcos (together known as the Group) for the year ended March 31, 2025 (‘FY2025) prepared in accordance with Indian Accounting Standards (Ind AS) and applicable REIT regulations, which include the comparative numbers for the year ended March 31, 2024 (‘FY2024). The financial information included herein is being presented to provide a general overview of the Groups performance for the financial year ended March 31, 2025 as compared against the financial year ended March 31, 2024 based on certain key financial metrics for general information purposes only and does not purport to present a comprehensive representation of the financial performance of the Group for these periods.
The Embassy REIT, the Trustee, the REIT assets and the Manager make no representation, express or implied, as to the suitability or appropriateness of this comparative information to any investor or to any other person. Some of the information contained in the following discussion(s), including information with respect to our plans and strategies, may contain forward-looking statements based on the currently held beliefs, opinions and assumptions. Forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause the actual results, financial condition, performance, or achievements of the Embassy REIT or industry results, to differ materially from the results, financial condition, performance or achievements expressed or implied by such forward-looking statements. In addition to statements which are forward looking by reason of context, the words may, will, should, expects, plans, intends, anticipates, believes, estimates, predicts, potential or continue and similar expressions identify forward-looking statements. Please refer to the disclaimer section at the end of the Annual Report for a discussion of the risks and uncertainties related to those statements. You should read this discussion in conjunction with our Audited Consolidated Financial Statements that we have included in this Annual Report and the accompanying notes to accounts.
Executive Overview
Embassy REIT is Indias first publicly listed Real Estate Investment Trust. We own, operate and invest in high quality real estate and related assets that generate rental income from our occupiers. We generate 44% of gross rents from Fortune 500 corporations and GCCs contribute 64% of our total rentals. As a REIT, we are mandated by SEBI to pay at least 90% of our Net Distributable Cash Flows as distributions to our unitholders.
Embassy REIT comprises 40.3 msf of completed area and 6.1 msf of under construction area. With the future development potential of 4.8 msf, the leasable area adds up to 51.1 msf as on March 31, 2025. The commercial office portfolio is spread across ten infrastructure like office parks (48.7 msf) and four prime city-center office buildings (2.5 msf) in Bengaluru, Mumbai, Pune, Chennai and National Capital Region (NCR).
Our portfolio is home to 272 blue chip corporate occupiers and comprises of 107 with strategic amenities, including four operational hotels and a 100 MW solar park that supplies renewable energy to park occupiers.
Our competitive strengths include the following:
Best-in-classofficepropertiesthatarecomplemented by high-quality infrastructure
Diversified, premier, multinational occupier base
Simple business with embedded growth levers
Assets strategically located in the top-performing markets with high barriers to entry
Highly experienced management team
Backing by renowned sponsor bringing expertise and local knowledge to our operations
Our focus on sustainability while executing our business
Our Strategy
Embassy REIT aims to maximize the total return for Unitholders by targeting growth in distributions and in NAV Unit. The operating and investment strategies we intend to execute to achieve this goal include:
Current Business Environment
CY2024 was a historic year for the Indian office real estate. With annual gross absorption at an all-time high of ~75 msf, India was one of the best-performing office markets in the world and the robust performance continued in Q4 of FY2025 with over 17 msf absorption in the top 7 Indian cities. The strong office demand is forecasted to continue in CY2025, with absorption expected to exceed that of the previous year by 10%. Amongst these, our core market Bengaluru once again outshined and contributed close to 30% of the total pan-India absorption in Q4 FY2025 and over 70% of the active RFPs as of date. Bengaluru continues to attract Global Capability Centers (‘GCCs), contributing to around 40% of pan India GCC leasing in Q4 FY2025. Also, with absorption outpacing supply, market rents in Bengaluru recorded a 3-5% YoY growth. (Source: CBRE)
GCCs continue to lead the office space take-up in India, on the back of the skilled Indian talent available at scale. As per a NASSCOM report, over 50 such centers were set up newly or expanded further in FY2025, taking up around 29 msf space. In Q4 FY2025 alone GCCs accounted for ~50% of the total leasing in the top 7 Indian cities. These global companies continue to pursue premium-quality wellness-focused properties, to attract and retain talent and to grow their presence in India. With around 500+ GCCs expected to be setup by 2030, the Indian office sector is set to repeat this stellar performance in the coming years.
Business Performance and Outlook
FY2025 Key Highlights:
Business Highlights
Leased 6.6 msf across 98 deals in FY2025 including 4.0 msf of new leases, 1.6 msf of renewals and ~1 msf of pre-leases
GCCs across sectors accounted for ~60% of the annual leasing activity
Portfolio occupancy stands at 91% by value* —Bengaluru at 92%, Mumbai at 100%, and Chennai at 95%
Financial Highlights
Grew Revenue from Operations and Net Operating Income (NOI) by 10% YoY to a record H40,389 mn and H32,835 mn, respectively
Delivered Distributions of H21,811 mn or H23.01 per unit, up 8% YoY for FY2025: Cumulative distributions of over H120 bn since listing
Refinanced ~H63 bn debt at an average rate of 7.98%; Continue to maintain a strong balance sheet with dual AAA/Stable credit ratings
Operational & Development Highlights
Delivered 2.5 msf new development in Bengaluru; Current development pipeline of 6.1 msf in Bengaluru & Chennai at 18% yield on cost
Acquired 5.0 msf premium business park in Chennai; Actively evaluating inorganic growth opportunities including ROFO assets from the Embassy Sponsor as well as other assets from third parties
Hotel portfolio performed strongly with 63% occupancy up 7% YoY, 12% ADR growth and growth in annual EBITDA by 25%
As Indias first listed REIT, we continue to deliver on strong business fundamentals and accelerate our growth investments. Since listing in April 2019, we grew our completed office portfolio by 63% to 40.3 msf, added 619 keys to our Total Business Ecosystem, increased our portfolio in-place rents by 46% from H63 to H92 psf, expanded our occupier base from 165 to 272 leading companies and our investor base from 4k to over 100k today. All these efforts have been translated into annualized total returns of over 10% to our unitholders, including more than H120 bn in distributions.
Coming to our annual results, FY2025 was a year of growth. With 6.6 msf of total leasing, 2.5 msf of new office deliveries in Bengaluru, acquisition of a 5.0 msf office park in Chennai and ~H63 bn of debt refinanced at leading rates, we surpassed our initial leasing guidance for the year, met our financial guidance and delivered 8% growth in distributions on a year-on-year basis.
On the leasing front, we leased a total of 6.6 msf in FY2025 and exceeded our original 5.4 msf leasing guidance by 22%. This 6.6 msf was signed across 98 deals and included 4.0 msf of new leases, 1.6 msf of renewals and ~1.0 msf of pre-commitments.
GCCs contributed over 60% of the total leasing, with the demand primarily driven by Technology, BFSI, Retail and Healthcare sectors. With 11 new GCC entrants this year, we now have 97 GCCs in our occupier roster of 272 corporates, contributing to over 60% of our annual rentals.
We also witnessed 3.1 msf of tenant exits during the year, primarily from IT services occupiers. Of this, we already leased close to half of the vacant area at around 38% spreads and have a promising pipeline for the remainder. With this churn in the portfolio, while our occupancy levels remained steady during the year, our in-place rents went up by over 5%.
We are currently at 87% occupancy at the portfolio level, with 9 out of 14 assets above 90% occupancy. Bengaluru, Mumbai and Chennai, that together contribute around 85% of REITs office portfolio value, continue to see an uptick in the occupancy levels with multiple demand tailwinds. At year-end, our Bengaluru portfolio was at 92%, Mumbai at 100% and Chennai at 95% occupancy levels. During the year, our Noida assets witnessed a remarkable uptick in occupancy with a 17% increase year on year. Pune market continues to be soft, with early 60% occupancy levels, and will take some more time to increase.
On the development front, we delivered 2.5 msf of new office buildings in Bengaluru, Indias leading office market. This included 0.6 msf of M3 Block B in Embassy Manyata and 1.9 msf of Block 8 in Embassy TechVillage. The deliveries this year are 90% occupied including expansion options.
Our commercial office development pipeline now totals 6.1 msf, all of which is in Bengaluru and Chennai. Of this, 3.2 msf is scheduled for delivery in FY2026 and is already 68% pre-leased, including expansion options.
On the acquisitions front, we acquired Embassy Splendid TechZone, a premium business park in Chennai, located in OMR 2, one of Chennais fastest growing commercial office micro markets. With a total leasable area of 5.0 msf, the park consists of an operational area of 1.4 msf, under construction area of 1.6 msf and future development potential of 2.0 msf. The acquisition was made at an attractive cap rate of 8.05% with an enterprise value of ~H12 bn, at a discount of 9.2% to the average of the two independent valuations.
On the financial front, we met our FY2025 guidance for Net Operating Income (NOI) and Distributions Per Unit (DPU). Our Revenue from Operations stood at H40,389 mn and NOI at H32,835 mn, both up 10% YoY. This was mainly driven by new lease-up at high re-leasing spreads, contracted rent escalations, delivery of new buildings, acquisition in Chennai and a ramp-up in the hotel business. This was partially offset by the impact of exits in our office portfolio. Our commercial office margins of 85% and hotel margins of around 51% continue to lead the industry. Our total distributions for the year amounted to H23.01 per unit, up 8% YoY. This DPU growth was driven by the 10% uptick in our NOI as well as positive working capital changes, which was partially offset by an increase in our interest costs during the year.
During the year, around H39.5 bn debt was due for maturity, which we successfully refinanced at an average rate of 7.93%. We also proactively refinanced an additional H24 bn of debt with lower rate instruments and achieved 37 bps proforma interest savings. We refinanced through a combination of listed debentures, bank loans and commercial paper. Our debt book currently comprises of 49% floating rate debt, this tactical approach allows us to benefit from any further cuts in the rate cycle. With this, we continue to have a well-diversified debt book, including large public sector banks, private pension funds, domestic mutual funds and insurers. Our net debt book now totals H197 bn, implying a 32% leverage ratio and 7.9% in-place cost. Also, around 17% of our debt matures in the first half of the next financial year, allowing us to take advantage of the current interest rate cycle.
As per the independent valuers assessment, our Gross Asset Value in Mar25 stood at ~H612 bn and our Net Asset Value at H423.22 per unit. This increase was mainly driven by our new deliveries, office park acquisition, ongoing development capex, improved hotel performance and an increase in the in-place rents as well as market rents for our Bengaluru and Mumbai properties. This was partially offset by a decrease in the GAV of our Energy Business owing to the reduction in the solar tariffs in Karnataka.
Forward Outlook:
Looking ahead, we remain focused on expanding our portfolio and strengthening operational resilience. With continued demand from global occupiers—particularly GCCs—we remain committed to deepen relationships with our tenants and accelerate development across our core markets. We expect our proactive asset management, strong leasing pipeline, and disciplined capital deployment to support further growth in NOI and distributions. Backed by a robust balance sheet and a resilient occupier base, we are well-positioned to capture emerging demand trends and deliver sustained value to our Unitholders.
Looking ahead, we expect to deliver double-digit growth in both our NOI and our distributions, supported by multiple levers embedded in our business. This will be led by the following key drivers:
1. Occupancy ramp-up
India remains optimally positioned to drive global offshoring demand, led by favorable demographics, skilled talent availability and cost-efficient high-quality spaces offered in Indias gateway cities. Hence, the demand for India offices continues to be largely driven by GCCs, especially in our core market of Bengaluru. These GCCs are sector-agnostic and continue to climb up the value chain in terms of the work being offshored to India. As per a report, by 2030 Karnataka is expected to host 330 of the Forbes 2000 firms and this will be the major growth driver for India office absorption especially in Bengaluru in the coming years.
On the other hand, many IT services occupiers continue to rationalize their real estate footprint as they focus on optimizing margins amid a business slowdown. Such IT Services occupiers contribute to less than 8% of our portfolio rents (as of FY2025-end), as these occupiers have continued to churn out, positively impacting our in-place portfolio rents.
Led by the offshoring demand from these GCCs, we currently have around 1.5 msf of leasing pipeline for Q1FY26 and expect to increase our portfolio occupancy to 93% to 94% by value, which translates to an occupancy of 90% to 91% by area for Mar26 (vs 87% by area in Mar25). This occupancy ramp-up will be a major driver for our NOI growth in FY2026.
2. New developments
Of our 6.1 msf active developments, we expect to complete and deliver 3.2 msf of office buildings over this fiscal year. Since all these developments are in Bengaluru and Chennai, these projects are at 18% NOI yields. Of these 3.2 msf, 2.2 msf is already leased out to marquee tenants, including expansion options.
The incremental interest expense on the currently capitalized construction debt will impact our distributions in the short-term, till these buildings are stabilized. Also, the interest expense for the year is expected to increase by around 10-12% YoY, driven by full-year impact of buildings delivered during
FY2025, new deliveries scheduled for FY2026 and due to the impact of refinancing and rate resets from previous year and present year. Our annual interest cost remains dependent on the trajectory of the market rate movement.
3. Rent growth
Our in-place portfolio rents have grown by 46% from H63 to H92 psf since our listing. Contracted rent escalations (generally around 15% every 3 years) and significant mark-to-market opportunity on lease expiries (10% blended MTM till FY2029) are key drivers for the rent growth in our portfolio. Further, the market rents in our key micro-markets of Bengaluru and Mumbai continue growing since last year, post the pause in rent growth during the pandemic period. In addition, due to the premium nature of our properties, we usually lease at rates above the prevailing market rents.
For FY2026, we expect to achieve around 14% contracted rent escalations on 7.5 msf leases. Further, of the 1.5 msf of leases due for expiry, based on our on-ground conversations, we expect to renew over one third of these leases and will look to fill up the remaining vacant area at healthy re-leasing spreads.
4. Inorganic growth
In addition to our organic growth plans, we are also evaluating sponsor and third-party acquisition opportunities to enhance our portfolio. These potential transactions are subject to market and pricing conditions.
5. Financing
We continue to finance our business at an industry leading rate of 7.9%. We have actively managed our cost of financing in an elevated interest rate environment. In the last 3 to 4 months the repo rates have fallen by 50 bps and our annual interest cost is dependent on the trajectory of the market rate movement. With an equal mix of fixed & floating rate debt we are primed to take advantage of any further rate cuts. Given our AAA/Stable rated debt book and our access to debt capital pools across mutual funds, banks, insures & other financial institutions we are confident on securing best-in-class industry rates for the upcoming refinance of H57 bn in FY2026.
Factors affecting our financial condition and results of operations
Our financial performance and results of operations are affected by several factors. The important ones in our view are listed here
• Commercial real estate market: We depend on the performance of the commercial real estate market in the cities where our office parks and commercial offices are located. The commercial real estate market in these cities, in turn, depends upon various factors such as economic and other market conditions, demographic trends, employment levels, availability of financing, prevailing interest rates, competition, bargaining power of occupiers, operating costs, government regulations and policies, and market sentiment.
Our office parks and office buildings are in the key markets of Bengaluru, Mumbai, Chennai, Pune and Noida. Within these cities, our business significantly depends on the performance of the submarkets where our portfolio assets are located. Most of these micro-markets have historically exhibited strong market dynamics with robust absorption and balanced infusion of new office supply resulting in rent stability/growth and low vacancy on an average, even during the tough periods of the pandemic.
Our portfolio assets are strategically located within their respective markets, which allows us to attract, retain and grow key occupiers within our office parks and commercial office buildings.
• Industry of occupiers: Our business also depends on the performance of the industry sectors of our occupiers. Sectors such as technology, banking, financial services, insurance, engineering, and manufacturing drive commercial leasing activity in India. Additionally, new sectors such as healthcare, retail, co-working, research, analytics and consulting have also emerged as key drivers of office real estate demand, as domestic and multinational companies in these sectors have been increasingly expanding or setting up operations in India.
Our tenant base is highly diverse with technology sector clients contributing 30% of our gross rentals, followed by financial services at 25% as of March 31, 2025. We believe that the domination of technology and banking and financial services sector as key occupiers of space in Indias commercial office segment will continue to significantly influence the results of our operations. We derive over 79% of Gross Annualized Rental Obligations from international corporations with over 50% headquartered in the United States, as at March 31, 2025. Further, GCCs contributes 64% of the gross rentals. The global and other factors impacting the businesses of these types of corporations may affect their ability to service contracted lease agreements.
Occupancy rates: The success of our business depends on our ability to maintain high occupancy acrosstheportfolio.Oursamestoreoccupancyacross the portfolio as of March 31, 2025 was 87%, remaining stable year on year. At the same time, occupancy by value stood at 91% for the period. Occupancy rates largely depend on the attractiveness of the markets and submarkets in which the portfolio assets are located, rents relative to competing properties, the supply of and demand for comparable properties, the facilities and amenities offered, the ability to minimize the intervals between lease expiries (or terminations) and our ability to foray into new leases (including pre-leases for under-construction properties or properties where leases are expiring).
We believe that our strategically located assets in attractive submarkets allow us to maintain high levels of occupancy. Further, we believe that replicating large infrastructure-like business parks such as ours is difficult given land acquisition complexities and long development timelines in India. We believe that we enjoy greater credibility with our occupiers because of our reputation, scale of operations and the amenities and infrastructure that we provide, which generally allows our assets to be viewed as premium properties, thereby enhancing the portfolios appeal to occupiers, which has resulted in high occupancy rates.
Lease expiries: We typically enter into long-term leases with our occupiers, which provide us a steady source of rental income. The tenure of leases for our assets are typically nine to fifteen years (assuming successive renewals at our occupiers option), with a three to five-year initial commitment period and consists of a mark-to-market rent on renewals.
We endeavor to foster and maintain strong relationships with our occupiers. We maintain regular communication with the corporate real estate heads of our occupiers through a dedicated customer relationship management programme, which ensures we anticipate and cater to tenant needs. Further, at most of our portfolio assets, we have implemented various energy efficiency and sustainability initiatives, which help attract occupiers. However, in cases where occupiers do not renew leases or terminate leases earlier than expected, it generally takes some time to find new occupiers which can lead to periods where we have vacant areas within the portfolio assets that do not generate facility rentals.
Rental rates: Our rental income primarily comprises facility rentals and income from maintenance services that we provide to our occupiers at the portfolio assets. Accordingly, our revenue from operations is directly affected by the lease rental rates of the portfolio assets, which are in turn affected by various factors like prevailing economic, income and demographic conditions in the submarket, prevailing rental levels in the submarket, amenities and facilities provided, property maintenance, government policies and competition
Escalations: Our existing lease agreements typically have built-in rent escalations, which has led to growth in our revenues in prior years and we expect it will help us generate stable and predictable growth in our revenue from operations. The contracted escalations of leases for our office parks are an average 12%-15% every three to five years. For our city-center office buildings, the contractual escalations stand at 15% every three years. Besides, due to the tenure of our existing leases and growth in the market rents of our portfolio, our average in-place rents are significantly below current market rents. We believe that this presents us with a rental growth opportunity by re-leasing the same space at higher rentals, given the demand for office real estate in respective submarkets coupled with our low vacancy levels. This allows us to be well positioned to capitalise on our Grade A office portfolio by realising the embedded rental growth within our office parks.
Development timeline and costs: As of March 31, 2025, we have 6.1 msf of under construction area and 4.8 msf of proposed development area. The timely development of our pipeline is expected to positively impact our financial performance. We typically commence construction based on our pre-leasing arrangements and an assessment of upcoming supply and recent absorption trends, as well as various other micro and macro factors impacting the demand for our assets.
We also construct office space on a built-to-suit basis, considering the specific requirements of our occupiers. This enhances our ability to develop and maintain long-term relationships with our occupiers. The timeline for development varies depending on factors such as size, complexity, and occupier specifications. Some examples of our built-to-suit projects are the 1.1 msf building delivered in December 2021 to JP Morgan at Embassy TechVillage in Bengaluru and also the 0.4 msf building delivered in November 2023 to Philips at Embassy Business Hub in Bengaluru.
Construction progress depends on various factors, including business plans, the availability of finance, labour and raw materials, the receipt of regulatory clearances, access to utilities such as electricity and water, the operating and financial condition of the construction companies we use in our business, and other contingencies such as adverse weather conditions. While industry construction costs have increased due to rise in costs of input materials led by global factors, our nimble design and robust procurement strategy, centralised procurement team and long-term relation with key vendors enables us to optimise the construction cost.
We capitalise our construction and borrowing costs in relation to our under-construction properties and capitalise brokerage costs with respect to our investment properties. These costs are depreciated based on the straight-line method over their estimated useful lives. When construction is completed, borrowing costs are charged to our statement of profit and loss as finance costs, causing an increase in expenses.
Cost of financing: Our finance costs primarily comprise interest expense on our non-convertible debentures, commercial papers and borrowings from banks and financial institutions. Our ability to obtain financing, as well as the cost of such financing, affects our business. Though we believe we can obtain funding at competitive interest rates as evidenced basis the fundraising done by us during FY2025. The cost of financing is material for us, as we require significant capital to develop our projects and while the recent rate cuts aids in optimizing our cost of financing, any increase in interest rates might affect our distributable surplus.
Government regulations and policies including taxes and duties: The real estate sector in India is highly regulated and there are several laws and regulations that apply to our business. Regulations applicable to our business include those related to land acquisition, funding sources, the ratio of built- up area to land area, land usage, the suitability of building sites, road access, necessary community facilities, open spaces, water supply, sewage disposal systems, electricity supply, environmental suitability, and size of the project. We also keep abreast of the evolving SEBI REIT regulations which oversee the setup, operations and governance of REITs in India. We strive to continuously maintain compliance with these regulations and incur various costs in the process, including fees to consultants, property tax and other taxes and duties.
In addition, some of our portfolio assets are located on land notified as part of SEZs. In the past, the leasing traction for these SEZ areas had been impacted by the uncertainty around amendments to the SEZ rules or introduction of the proposed DESH bill as a separate framework. The leasing traction has picked up again post the Dec23 amendment to the SEZ rules permitting demarcation of a portion of the built-up area within an SEZ unit on a floor-by-floor basis as a non-processing area. However, certain duties might need to be repaid for this SEZ demarcation which might impact our distributable surplus.
Competition: We operate in competitive markets for the acquisition, ownership, and leasing of commercial real estate. We compete for occupiers with numerous real estate owners and operators who own properties like our own in these markets. Among the factors influencing leasing competition are location, rental rates, building quality and levels of services provided to occupiers.
Competition from other developers in India may adversely affect our ability to sell or lease our projects, and continued development by other market participants could result in saturation of the real estate market, which could adversely impact our revenues from commercial operations. Increasing competition could result in price and supply volatility which could materially and adversely affect our operations and cause our business to suffer.
Future acquisitions: We intend to selectively acquire from the Embassy Sponsor or third parties, commercial real estate assets that meet our investment criteria. Each new acquisition that we complete may materially affect our overall results of operations and financial position. In addition, our acquisition strategy may require a significant amount of working capital and long-term funding. Our ability to acquire properties will depend on our ability to secure financing on commercially viable terms, which will in part be affected by the prevailing interest rates or the price of our units at the time of acquisition.
Operating and maintenance expenses: Our operating and maintenance expenses primarily consist of repair and maintenance (of buildings, common areas, machinery, and others), power and fuel expenses, property management fees and expenses related to housekeeping and security services. Factors which impact our ability to control these operating expenses include (but are not limited to) asset occupancy levels, fuel prices, general cost inflation, periodic renovation, refurbishment, and other costs related to re-leasing.
For the portfolio assets we provide Common Area Maintenance (CAM) services to our occupiers. We derive income from these maintenance services that include a margin on the expenses incurred for providing such services.
Cost increases because any of the foregoing may adversely affect our profitability, margins, and cash flows. Circumstances such as a decline in market rent or pre-term lease cancellation may cause revenue to decrease, although the expenses of owning and operating a property may not decline in line with the decrease in revenue. While certain expenses may vary with occupancy, operating and maintenance expenses such as those relating to general maintenance, housekeeping and security services may not decline even if a property is not fully occupied.
Geopolitical and Macroeconomic Risk: Our business is influenced by global and regional geopolitical dynamics, particularly due to our dependence on multinational occupiers, many of whom are headquartered in North America and Europe. Escalation in trade tensions, such as changes in tariff policies, protectionist measures, or sanctions, can impact the global investment appetite of our tenants and delay expansion decisions.
Additionally, any deterioration in Indias bilateral relations with neighboring countries—including geopolitical tensions or cross-border conflicts— could lead to short-term volatility in capital markets, foreign investment flows, and overall business sentiment. As a platform with assets concentrated in key Indian cities and exposure to global corporate occupiers, prolonged geopolitical instability may affect leasing momentum, capital availability, or valuation outlooks. Embassy REIT continues to monitor these developments closely and maintains a conservative balance sheet and diversified occupier base to mitigate potential disruptions.
Basis of preparation of consolidated financial statements
The Consolidated Financial Statements of the Embassy Office Parks Group comprises the Consolidated Balance Sheet and the Consolidated Statement of Net Assets at fair value as at 31 March 2025, the Consolidated Statement of Profit and Loss including other comprehensive income, the Consolidated Statement of Cash Flow, the Consolidated Statement of Changes in Unitholders Equity, the Statement of Net Distributable Cashflows of Embassy REIT and each of the SPVs, the Consolidated Statement of Total Returns at fair value and a summary of material accounting policies and other explanatory information for the year ended 31 March 2025. The Consolidated Financial Statements were approved for issue in accordance with resolution passed by the Board of Directors of the Manager on behalf of the Trust on 29 April 2025.
The Consolidated Financial Statements have been prepared in accordance with the requirements of SEBI (Real Estate Investment Trusts) Regulations, 2014 as amended from time to time including any guidelines and circulars issued there under read with SEBI master circular no. SEBI/HO/DDHS-PoD-2/P/CIR/2024/43 dated 15 May 2024 (the "REIT regulations); Indian Accounting Standard as defined in Rule 2(1)(a) of the Companies (Indian Accounting Standards) Rules, 2015 (as amended) prescribed under Section 133 of the Companies Act, 2013 (Ind AS) and other accounting principles generally accepted in India, to the extent not inconsistent with the REIT regulations.
Embassy REIT had acquired ESNP Property Builders and Developers Private Limited ("ESNP") on 3 June 2024. ESNP has been consolidated from 1 June 2024, a date close to the acquisition date, as there are no significant transactions or events that have occurred between 1 June 2024 and 3 June 2024 and the effect thereof is not considered to be material to the results for the year ended 31 March 2025.
The Consolidated Financial Statements have been prepared using uniform accounting policies for like transactions and other events in similar circumstances. The financial statements of all the SPVs and the Trust used for the purpose of consolidation are drawn up to the same reporting date i.e. 31 March 2025.
The accounting policies adopted and methods of computation followed are consistent with those of the previous financial year, except for items disclosed below:
Ind AS 116 - Leases
On 9 September 2024, the Ministry of Corporate Affairs issued amendments to Ind AS 116 concerning sale and leaseback transactions. The amendment impact how a seller-lessee accounts for variable lease payments that arise in a sale and leaseback transaction. The amendments introduce a new accounting model for variable payments and will require seller-lessees to reassess and potentially restate sale and leaseback transactions.
Ind AS 117 - Insurance Contracts
The Ministry of Corporate Affairs has issued a notification dated 12 August 2024 introducing Ind AS 117, Insurance Contracts for accounting of insurance contracts which replaces the current standard Ind AS 104, Insurance Contracts. The amendments are applicable with effect from 12 August 2024.
Additionally, amendments have been made to Ind AS 101, First-time Adoption of Indian Accounting Standards, Ind AS 103, Business Combinations, Ind AS 105, Non current Assets Held for Sale and Discontinued Operations, Ind AS 107, Financial Instruments: Disclosures, Ind AS 109, Financial Instruments and Ind AS 115, Revenue from Contracts with Customers to align them with Ind AS 117. The amendments also introduce enhanced disclosure requirements, particularly in Ind AS 107, to provide clarity regarding financial instruments associated with insurance contracts.
The Ministry of Corporate Affairs has issued a clarification dated 28 September 2024 that an insurer or insurance company may provide its financial statement as per Ind AS 104 for the purposes of consolidated financial statements of its parent, investor, or venturer till the IRDAI has notified Ind AS 117.
The above amendments are not relevant or do not have an impact on the Financial Statements of the Group. The Group has not early adopted any standard, interpretation or amendment that has been issued but is not yet effective.
Summary of significant judgements and estimates used in the preparation of the Consolidated Financial Statements
The preparation of Consolidated Financial Statements in conformity with generally accepted accounting principles in India (Ind AS) requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, income and expenses. Actual results could differ from those estimates.
Estimates and underlying assumptions are reviewed on a periodic basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and in any future periods affected.
Information about critical judgements in applying accounting policies that have the most significant effect on the amounts recognised in the Consolidated Financial Statements is included in the following notes:
1. Business combinations
2. Impairment of goodwill and intangible assets with infinite useful life
3. Classification of lease arrangements as finance lease or operating lease
4. Classification of assets as investment properties or as property, plant and equipment
5. Significant judgements involved in the purchase price allocation of the assets acquired and liabilities assumed on account of Business Combination and deferred tax accounting on the resultant fair value accounting
6. Judgements in preparing Consolidated Financial Statements
7. Classification of Unitholders funds
8. Significant judgements is involved in the allocation cost of acquisition to the identifiable assets and liabilities based on their relative fair values at the date of acquisition in case of acquisition that does not represent a business combination.
Information about assumptions and estimation uncertainties that have a significant risk resulting in a material adjustment during the year ended 31 March 2025 is included in the following notes:
1. Fair valuation and disclosures and impairment of non-financial assets being investment properties and property plant and equipment - The fair value of investment properties and property, plant and equipment are reviewed regularly by management with reference to independent property valuations and market conditions existing at half yearly basis. The independent valuers are independent appraisers with a recognised and relevant professional qualification and with recent experience in the location and category of the investment properties being valued. Judgment is also applied in determining the extent and frequency of independent appraisals.
2. Useful lives of Investment Properties and Property, Plant and Equipment
3. Valuation of financial instruments
4. Recognition of deferred tax asset on carried forward losses and recognition of minimum alternate tax credit: availability of future taxable profit against which tax losses carried forward can be used. Further, significant judgements are involved in determining the provision for income taxes, including recognition of minimum alternate tax credit, in SPVs entitled for tax deduction under Section 80IAB of the Income Tax Act, 1961, wherein the tax deduction is dependent upon necessary details available for exempt and non-exempt income.
Analysis of consolidated statement of profit and loss
(H in mn)
| Particulars | FY 2025 | As % of Revenue | FY 2024 | As % of Revenue |
| Income and gains | ||||
| Revenue from operations | 40,389.32 | 100% | 36,851.82 | 100% |
| Interest income | 876.86 | 2% | 1,305.60 | 4% |
| Other income | 546.81 | 1% | 725.24 | 2% |
| Total income | 41,812.99 | 38,882.66 | ||
| Expenses | ||||
| Cost of materials consumed | 456.13 | 1% | 414.36 | 1% |
| Employee benefits expense | 632.22 | 2% | 582.76 | 2% |
| Operating and maintenance expenses | 859.81 | 2% | 910.66 | 2% |
| Repairs and maintenance | 3,645.32 | 9% | 3,334.31 | 9% |
| Valuation expenses | 9.64 | 0% | 10.83 | 0% |
| Audit fees | 55.56 | 0% | 57.17 | 0% |
| Insurance expenses | 136.39 | 0% | 174.05 | 0% |
| Investment management fees | 1,108.53 | 3% | 1,003.98 | 3% |
| Trustee fees | 2.95 | 0% | 2.95 | 0% |
| Legal and professional fees | 350.09 | 1% | 360.01 | 1% |
| Other expenses | 2,668.85 | 7% | 2,307.47 | 6% |
| Total expenses | 9,925.49 | 25% | 9,158.55 | 25% |
| Earnings before share of profit of equity accounted investee, finance costs, depreciation, amortisation, impairment and tax | 31,887.50 | 79% | 29,724.11 | 81% |
| Finance costs | 13,286.25 | 33% | 10,872.35 | 30% |
| Depreciation expense | 9,297.97 | 23% | 7,572.24 | 21% |
| Amortisation expense | 2,117.18 | 5% | 2,117.65 | 6% |
| Impairment loss/(reversal) | 6,410.93 | 16% | (836.75) | (2)% |
| Profit before share of profit of equity accounted investee and tax | 775.17 | 2% | 9,998.62 | 27% |
| Share of profit after tax of equity accounted investee | 1,155.25 | 3% | 892.11 | 2% |
| Profit before tax | 1,930.42 | 5% | 10,890.73 | 30% |
| Tax expense | (14,313.94) | (35%) | 1,250.45 | 3% |
| Profit for the year | 16,244.36 | 40% | 9,640.28 | 26% |
| Other comprehensive income | 0.49 | 0% | 6.74 | 0% |
| Total comprehensive income | 16,244.85 | 40% | 9,647.02 | 26% |
Revenue from operations
(H in mn)
| Particulars | FY 2025 | FY 2024 | Variance | Variance % |
| Facility rentals | 28,179.86 | 25,285.61 | 2,894.25 | 11% |
| Income from finance lease | 325.01 | 237.45 | 87.56 | 37% |
| Revenue from contracts with customers | ||||
| Maintenance services | 5,729.04 | 4,891.33 | 837.71 | 17% |
| Room rentals | 3,061.01 | 2,475.20 | 585.81 | 24% |
| Sale of food and beverages | 1,733.87 | 1,692.29 | 41.58 | 2% |
| Income from generation of renewable energy | 989.94 | 1,582.22 | (592.28) | (37)% |
| Other operating income: | ||||
| - Hospitality | 244.59 | 195.22 | 49.37 | 25% |
| - Others | 126.00 | 492.50 | (366.50) | (74)% |
| Total revenue from operations | 40,389.32 | 36,851.82 | 3,537.50 | 10% |
Our revenue from operations comprises the following sources:
Facility rentals
Revenue from facility rentals comprises the base rental from our properties, car parking income, fit-out rentals and other rentals as below:
Base rentals: Base rentals comprises rental income earned from the leasing of our assets.
Car parking income: Car parking income comprises revenue earned from the operations of parking facilities located at our properties; and
Fit-out rentals: For some of our occupiers, we provide customised alterations and enhancements as per the occupiers requirements (as opposed to warm shell premises that contain only minimally furnished interiors). For such properties, we recover the value of the fit-outs provided through fit-out rentals, to the extent such leases are classified as operating lease as per accounting requirements.
Facility rentals for the portfolio increased by H 2,894.25 mn or 11% from H25,285.61 mn in FY2024 to H28,179.86 mn in FY2025. A summary of movement is captured in the below table:
Facility rental portfolio
(H in mn)
| Particulars | Amount | Variance (%) |
| Facility rentals for the year ended March 31, 2024 | 25,285.61 | |
| Increase in contracted revenue | 667.76 | 3% |
| New acquisition | 543.57 | 2% |
| Lease up, vacancy and | 1,682.92 | 6% |
| Mark-to-Market (MTM) | ||
| Facility rentals for the year ended March 31, 2025 | 28,179.86 | 11% |
Facility rentals increased primarily due to:
Contracted revenue: Contracted lease escalation increased the revenue by H667.76 mn, majorly in Embassy Manyata and Embassy Tech Village.
New acquisition: The Group acquired ESNP on 3 June 2024 increasing the revenue by H543.57 mn.
Lease up, vacancy and Mark-to-Market (MTM): Lease up across Embassy Manyata, Embassy TechVillage, Embassy TechZone, Embassy Galaxy, Embassy 247, Embassy TechZone and others as well as renewals spread across all the parks amounting to H4,068.25 mn off set by reduction in facility rentals to the extent of H2,385.33 mn due to occupier exits during the year, resulted in net increase in revenue by H1,682.92 mn
Income from finance lease
Income from finance leases comprise income from fit-out rentals where such leases are classified as finance leases. Leases are classified as finance leases when substantially all the risks and rewards of ownership transfer to the lessee.
Income from finance lease increased by H87.56 mn or 37% from H237.45 mn in FY2024 to H325.01 mn in FY2025 due to new fit-out rental contracts with occupiers at Embassy Manyata, Embassy Oxygen and Embassy One.
Revenue from room rentals and sale of food and beverages
Revenue from room rentals and sale of food and beverages comprises revenue generated from our operating hotels viz. Hilton at Embassy GolfLinks and Hilton Garden Inn (HGI) and Hilton Inn (HI) at Embassy Manyata and Four Seasons at Embassy One.
During the year, the hospitality sector improved and witnessed a robust performance due to steady domestic demand and an increase in demand from corporate as they ramp up their operations at pre-pandemic level. This has resulted into an increase of revenue from room rentals by H585.81 mn or an increase of 24% from H2,475.20 mn in FY2024 to H3,061.01 mn in FY2025.
The segment also witnessed a corresponding increase increase in sale of food and beverages by H41.58 mn or 2%, from H1,692.29 mn in FY2024 to H1,733.87 mn in FY2025.
Additionally, the hospitality segment also witnessed an increase in other hospitality income by H49.37 mn or 25% from H195.22 in FY2024 to H244.59 mn in FY2025 due to increase in other ancillary services which is in line with increase in occupancy.
Maintenance services
Income from maintenance services consists of the revenue received from our occupiers for the Common Area Maintenance (CAM) services provided across our commercial office portfolio. Income from maintenance services is generally a function of our maintenance expenses at the portfolio assets, with a change in maintenance expenses resulting in a corresponding change in maintenance service income, along with the impact of lease up/exits at our properties.
Income from maintenance services for the portfolio increased by H837.71 mn or 17% from H4,891.33 mn in FY2024 to H5,729.04 mn in FY2025, primarily due to new lease ups, MTM and CAM escalations.
Income from generation of renewable energy
The 100 MW solar park at Embassy Energy is located in Bellary district of Karnataka and helps reduce an estimated 233 mn kgs of carbon footprint by providing green energy to our occupiers. Income from renewable energy reduced by H592.28 mn i.e. from H1,582.22 mn in FY2024 to H989.94 mn in FY2025. This reduction was mainly due to a decrease in tariff rates by the Government by 14 % on a blended basis and lower generation of units by 54 mn.
| Solar power generation | ||
| Particulars | FY 2025 | FY 2024 |
| Capacity (MW) | 100 | 100 |
| Solar units generated (mn units) | 141 | 195 |
| Solar units consumed (mn units) | 141 | 195 |
| Average blended tariff (H per unit) | 7.00 | 8.10 |
Other operating income
Other operating income majorly includes revenue from ancillary operating departments at our Hospitality segment as well as leasing support income. Other operating income decreased by H366.50 mn or 74% from H492.50 mn in FY2024 to H126 mn in FY2025 primarily due to reduction in compensation income received from EPDPL in FY2025, due to receipt of the occupancy certificate in October 2023 with respect to the warm shell building for M3 Block A at Embassy Manyata whereby EPDPL was no longer obligated to pay the rental compensation.
Property-wise revenue from operations
We have provided a property-wise/ asset-wise break up of our revenue from operations for FY2025 vis-?-vis FY2024.
Asset-wise revenue from operation
(H in mn)
| FY 2025 | FY 2024 | |||||
| Asset SPV | Name of the property | Location | Revenue | As % of total revenue | Revenue | As % of total revenue |
| MPPL | Embassy Manyata | Bengaluru | 15,429.08 | 38% | 14,500.46 | 39% |
| ETV Assets | Embassy TechVillage | Bengaluru | 8,727.83 | 22% | 8,258.93 | 22% |
| QBPL | Hotel, Retail and Office at Embassy One and Embassy Quadron | Bengaluru and Pune | 2,616.59 | 6% | 2,311.91 | 6% |
| IENMPL | Express Towers | Mumbai | 1,661.23 | 4% | 1,484.57 | 4% |
| VCPPL | Embassy 247 | Mumbai | 1,832.07 | 5% | 1,686.95 | 5% |
| ETPL | FIFC | Mumbai | 1,392.10 | 3% | 1,302.16 | 4% |
| EPTPL | Embassy TechZone | Pune | 2,112.27 | 5% | 1,673.90 | 5% |
| QBPPL | Embassy Qubix | Pune | 768.92 | 2% | 851.13 | 2% |
| OBPPL | Embassy Oxygen | Noida | 1,706.60 | 4% | 1,464.48 | 4% |
| GSPL | Embassy Galaxy | Noida | 863.61 | 2% | 577.72 | 2% |
| UPPL | Hilton - Embassy GolfLinks | Bengaluru | 1,166.33 | 3% | 1,026.43 | 3% |
| EEPL | Embassy Energy | Bellary | 989.94 | 3% | 1,582.22 | 4% |
| ECPL | Embassy HUB | Bengaluru | 352.82 | 1% | 130.96 | 0% |
| ESNP | Embassy Splendid TechZone | Chennai | 769.93 | 2% | - | 0% |
| Total | 40,389.32 | 100% | 36,851.82 | 100% | ||
Interest income
Interest income includes interest on (i) debentures, (ii) fixed deposits with banks, (iii) security deposits, (iv) income-tax refunds and (v) others. Interest income decreased by H428.74 mn or 33% from H1,305.60 mn for FY2024 to H876.86 mn for FY2025
The decrease in interest income is majorly on account of interest income on advances for M3 Block B due to receipt of occupancy certificate in September 2024 with respect to the warm shell building for M3 Block B at Embassy Manyata whereby EPDPL was no longer obligated to pay the interest.
Other income
The details of other income as per the Consolidated Financial Statements are set forth in the below table:
Other income
(H in mn)
| Particulars | FY 2025 | FY 2024 | Variance | Variance % |
| Net changes in fair value of financial instruments | 5.17 | 54.13 | (48.96) | (90)% |
| Liabilities no longer required written back | 22.28 | 84.38 | (62.10) | (74)% |
| Profit on sale of mutual funds | 131.33 | 159.04 | (27.71) | (17)% |
| Net gain on disposal of Property, Plant and Equipment/ Investment Properties | 32.70 | 139.74 | (107.04) | (77)% |
| Miscellaneous | 355.33 | 287.95 | 67.38 | 23% |
| Total | 546.81 | 725.24 | (178.43) | (25)% |
Other income for FY2025 was H546.81 mn, a decrease of H178.43 mn or 25%, compared to H725.24 mn for FY2024. The decrease was primarily as a result of a change in fair value of financial instruments, a one-time income of sale/ scrap of investment properties in FY2024 majorly due to demolition and refurbishment of assets, Excess liabilities which were no longer required in FY2024 offset by IT refund received in FY2025.
Expenses
The Consolidated Financial Statements include expenses as set forth in the below table:
Expenses
(H in mn)
| Particulars | FY 2025 | FY 2024 | Variance | Variance % |
| Cost of materials consumed | 456.13 | 414.36 | 41.77 | 10% |
| Employee benefits expense | 632.22 | 582.76 | 49.46 | 8% |
| Operating and maintenance expenses | 859.81 | 910.66 | (50.85) | (6)% |
| Repairs and maintenance | 3,645.32 | 3,334.31 | 311.01 | 9% |
| Valuation expenses | 9.64 | 10.83 | (1.19) | (11)% |
| Audit fees | 55.56 | 57.17 | (1.61) | (3)% |
| Insurance expenses | 136.39 | 174.05 | (37.66) | (22)% |
| Investment management fees | 1,108.53 | 1,003.98 | 104.55 | 10% |
| Trustee fees | 2.95 | 2.95 | - | 0% |
| Legal and professional fees | 350.09 | 360.01 | (9.92) | (3)% |
| Other expenses | 2,668.85 | 2,307.47 | 361.38 | 16% |
| Total expenses | 9,925.49 | 9,158.55 | 766.94 | 8% |
Our expenses comprises the following:
Cost of materials consumed
Cost of materials consumed includes direct material cost of our three operating hotels, i.e., Hilton at Embassy GolfLinks and Embassy Manyata and the Four Seasons at Embassy One (Hospitality operations) primarily towards the provision of food and beverage services to the guests at these hotels.
Cost of materials consumed increased marginally by H41.77 mn or 10% from H414.36 mn for FY2024 to H456.13 mn for FY2025 in line with increase in revenue from hospitality operations.
Employee benefits expense
Employee benefits expense primarily includes salaries and wages, contribution to provident and other funds and staff welfare expenses in relation to our Hospitality operations.
Employee benefit expenses increased by H49.46 mn or 8% from H582.76 mn in FY2024 to H632.22 mn in FY2025 mainly due to increment and new hirings in the current year.
Operating and maintenance expenses
Operating and maintenance expenses include power and fuel expenses and operating consumables in relation to our Common Area Maintenance operations.
Operating and maintenance expenses decreased by H50.85 mn or 6% from H910.66 mn for FY2024 to H859.81 mn for FY2025 mainly attributable to savings in electricity expenses due to roof top solar panel installation across all locations and reduction in tariff.
Repairs and maintenance
Repairs and maintenance expenses include repairs towards common area maintenance, buildings, machinery, and others.
Our repairs and maintenance expenses increased by H311.01 mn or 9% from H3,334.31 mn for FY2024 to H3,645.32 mn for FY2025. This increase was primarily due to new acquisition during the year, Embassy Splendid TechZone, full year operations of previous year deliveries of Phase-I at Embassy Hub and M3 Block A at Embassy Manyata, new deliveries of Tower 1 at Embassy Oxygen, M3 Block B at Embassy Manyata and Block 8 at Embassy TechVillage and increase in maintenance cost of projects after the expiry of the defect liability period during FY2025.
Insurance
Insurance expenses decreased by H37.66 mn or 22% from H174.05 mn for FY2024 to H136.39 mn for FY2025 due to cost optimization and negotiations with our insurers.
Investment management fees
This includes the property management fees and REIT management fees.
Property management fees: This represents the fees earned by the Manager to the REIT pursuant to the investment management agreement.
The Manager earns property management fees computed at 3% per annum of facility rentals collected by the relevant property with respect to operations, maintenance, administration, and management of the Holdco or the SPVs, as applicable. The fees have been determined to meet the ongoing costs of the Manager to undertake the services provided to the Embassy REIT and REIT assets. Property management fees increased by H85.32 mn or 11% from H765.62 mn for FY2024 to H850.94 mn for FY2025 in line with increase in collection from facility and fitout rentals.
REIT management fees: This represents fees earned by the Manager to the REIT pursuant to the investment management agreement between the REIT and Manager. REIT management fees is computed at 1% of the REIT distributions. The fees have been determined for undertaking management of the REIT and its investments. REIT management fees for FY2025 amounts to H257.59 mn vis-?-vis H238.36 mn for FY2024, which are in line with the distributions for respective years.
Legal and professional fees
Legal and professional fees represent amounts paid to consultants for their services in relation to legal and compliance advisory, accounting and taxation advisory and internal audit. Legal and professional fees have decreased by H9.92 mn or 3% from H360.01 mn for FY2024 to H350.09 mn for FY2025 due to non-recurring expenses incurred in FY2024 towards consulting and advisory services.
Other expenses
Other expenses mainly include the following:
(H in mn)
| Particulars | FY 2025 | FY 2024 | Variance | Variance % |
| Property tax (net) | 1,325.25 | 1,197.07 | 128.18 | 11% |
| Rates and taxes | 64.71 | 68.81 | (4.10) | (6%) |
| Corporate Social Responsibility (CSR) expenses | 116.89 | 128.72 | (11.83) | (9%) |
| Marketing and advertising expenses | 341.78 | 293.03 | 48.75 | 17% |
| Loss on sale of fixed assets | 33.58 | 6.89 | 26.69 | 387% |
| Brokerage and commission | 139.78 | 111.30 | 28.48 | 26% |
| Other direct and indirect expenses | 646.86 | 501.65 | 145.21 | 29% |
| Total other expenses | 2,668.85 | 2,307.47 | 361.38 | 16% |
• Property tax: Property tax increased by H128.18 mn or 11% from H1,197.07 mn for FY2024 to H1,325.25 mn for FY2025 mainly due to new deliveries in FY2025 pertaining to M3 Block B at Embassy Manyata and Parcel 8 at Embassy TechVillage, full year impact of previous year deliveries pertaining to Phase I at Embassy Hub and acquisition of Embassy Splendid TechZone.
• Marketing and advertising expenses: Marketing and advertisement expenses have increased by H48.75 mn or 17% from H293.03 mn for FY2024 to H341.78 mn for FY2025 due to an increase in expenses on tenant engagement.
• Loss on sale of fixed assets: Loss on sale of fixed assets has increased by H26.69 mn or 387% from H6.89 mn for FY2024 to H33.58 mn for FY2025 due to scrap sales across various SPVs with respect to redevelopment/refurbishment work.
• Brokerage and Commission: Brokerage and commission represent brokerage expenses for Hospitality segment. The expense for FY2025 amounts to H139.78 mn vis-?-vis H111.30 mn for
FY2024, mainly due to increase in Hospitality operations during the year.
• Other direct and indirect expenses: Other direct and indirect expenses majorly include management fees paid by hotels, travel and conveyance, and bank charges. Other direct and indirect expenses increased by H145.21 mn or 29% from H501.65 mn for FY2024 to H646.86 mn for FY2025 majorly due to an increase in the management fees paid by hotels owing to increased operations during the year.
Earnings before share of profit of equity accounted investee, finance costs, depreciation, amortisation, impairment loss and tax (EBITDA)
Our EBITDA for FY2025 was H31,887.50 mn, an increase of H2,163.39 mn or 7%, compared to H29,724.11 mn for FY2024 primarily driven by the increase in Revenue from Operations, savings in operating and maintenance expenses, insurance expenses partially offset by increased repairs and maintenance expenses and other expenses including hotel operating expenses. The EBITDA margins stood at 79% compared to 81% for FY2024.
Finance costs
The Consolidated Financial Statements include finance costs as set forth in the below table:
(H in mn)
| Particulars | FY 2025 | FY 2024 | Variance | Variance % |
| Interest expenses | ||||
| - on borrowings from banks and financial institutions | 5,168.07 | 3,062.52 | 2,105.55 | 69% |
| - on lease deposits | 613.26 | 466.51 | 146.75 | 31% |
| - on lease liabilities | 175.11 | 114.77 | 60.34 | 53% |
| - on non convertible debentures | 6,743.22 | 7,050.14 | (306.92) | (4%) |
| - on commercial papers | 586.59 | 178.41 | 408.18 | 229% |
| Total finance costs | 13,286.25 | 10,872.35 | 2,413.90 | 22% |
We capitalise our finance costs in relation to our under-construction properties. When construction is completed, the finance cost is charged to our statement of profit and loss, causing an increase in our finance costs. The Company has also explored various new options for refinancing existing debt.
The increase in finance costs is mainly on account of :
a. interest impact of loan taken for acquisition of Embassy Splendid Techzone.
b. interest expenses incurred on new deliveries in current year (capitalisation of Tower 1 at Embassy Oxygen, Parcel 8 at Embassy TechVillage and M3 Block B at Embassy Manyata) and full year impact of previous year deliveries (capitalisation of Phase I at Embassy Hub and M3 Block A at Embassy Manyata)
c. interest expended on assets such as M3 at Embassy Manyata for true-up and other capital expenditure,
d. higher interest cost due to refinance of Series II, III and V NCDs,
e. an increase in interest on lease liability,
f. an increase in interest on lease deposits,
Depreciation and amortisation expense
Depreciation and amortisation expense increased by H1,725.26 mn or 18% from H9,689.89 mn in FY2024 to H11,415.15 mn in FY2025 primarily due to new deliveries pertaining to Tower 1 at Embassy Oxygen, M3 Block B at Embassy Manyata, Parcel 8 at Embassy TechVillage, full year impact of previous year deliveries pertaining to Phase I at Embassy Hub and M3 Block A at Embassy Manyata and non-recurring impact of accelerated depreciation pertaining to Block B at Embassy Manyata on account of redevelopment.
Impairment loss/reversal (net of depreciation)
In FY2025, the Group recognised an impairment loss of H6,410.93 mn in FY2025. Out of which H3,703.25 mn pertains to solar segment and H2,707.68 pertains to commercial office segment. This was mainly in relation to reduction in applicable tariffs in solar business as per order dated 27 March 2025 issued by the Karnataka Electricity Regulatory Commission (KERC) and slower than anticipated lease up of commercial properties. The impairment test performed considers the current economic conditions and revised business plans to determine the higher of the ‘value in use and the ‘fair value less cost to sell; in accordance with Ind AS 36.
In FY2024, we recorded a one-time impairment loss reversal amounting to H836.75 mn. As at March 31, 2023, an impairment loss amounting to Rs 886.18 mn was accounted against property, plant and equipment and impairment loss amounting to H31.71 mn was accounted against investment property. Considering the ramp up of room occupancy, recovery in our hospitality business operations and increase in lease-up, we updated the financial projections based on which the future cash flows have been estimated for the purpose of determining the recoverable amount of the aforesaid property, plant and equipment and investment properties as at March 31, 2024. Since the recoverable amount exceeds the carrying value of property, plant and equipment and investment properties as at March 31, 2024, we reversed the impairment loss of H836.75 mn (net of depreciation of H81.14 mn) which was recognised in the statement of profit and loss during the year ended March 31, 2024.
Profit before share of profit of equity accounted investee and tax
As a result of the foregoing, we recorded H775.17 mn in profit before share of profit of equity accounted investee and tax for FY2025, as compared to H9,998.62 mn in FY2024, an decrease of H9,223.45 mn or 92%.
Share of profit after tax of equity accounted investee
The share of profit after tax in Embassy GolfLinks, our investment entity, an equity accounted investee, for FY2025 was H1,155.25 mn as compared with H892.11 mn for FY2024. The increase was largely a result of the improved operational and financial performance of Embassy GolfLinks, leading to an increase in revenue from operations offset by an increase in operating and maintenance expenses.
Profit before tax
As a result of the foregoing, we recorded a profit before tax of H1,930.42 mn for FY2025, as compared to a profit before tax of H10,890.73 mn for FY2024, a decrease of H8,960.31 mn or 82%.
Tax expense
The portfolio of assets which we own are housed in 15 SPVs, which have different tax considerations including SEZ benefits, available MAT credit etc. and accordingly will have varying current tax percentages. On a blended basis, our current taxes for FY2025 and FY2024 works out to 4% of our revenue from operations at the Consolidated Group level.
The Consolidated Financial Statements include tax expenses as set forth in the below table:
Tax expense
(H in mn)
| Particulars | FY 2025 | FY 2024 | Variance | Variance % |
| Current tax | 1,676.45 | 1,427.74 | 248.71 | 17% |
| Deferred tax credit | (15,990.39) | (177.29) | (15,813.10) | 8,919% |
| Total tax expenses | (14,313.94) | 1,250.45 | (15,564.39) | (1,245)% |
Total tax expenses decreased by H15,564.39 mn or 1,245% from H1,250.45 mn for FY2024 to H (14,313.94) mn for FY2025.
Current tax expense has increased by H248.71 mn or 17% from H1,427.74 mn to H1,676.45 mn for FY2025. This was primarily due to higher current tax in Embassy TechVillage offset by tax shield on the accelerated depreciation pertaining to Block B at Embassy Manyata.
Deferred tax credit has increased significantly by H15,813.10 mn or 8,9191% from deferred tax credit of H177.29 mn in FY2024 to H15,990.39 mn in FY2025 due to reduction of deferred tax liability amounting to H14,140.73 mn on account of change in long-term Capital Gains tax rate from 20% to 12.5% and removal of indexation benefit for calculation of long-term capital gains w.e.f 23 July 2024 and due to impairment loss on assets recognized in the current year.
Total Comprehensive Income
As a result of the foregoing, our profit for FY2025 was H16,244.85 mn as compared with H9,647.02 mn for FY2024, an increase of H6,597.83 mn or 68%.
Non-GAAP Measures
Net Operating Income (NOI)
Based on the ‘management approach as defined in Ind AS 108, the Chief Operating Decision Maker (‘CODM) evaluates the Embassy Office Parks performance and allocates resources based on an analysis of various performance indicators by operating segments.
We use NOI internally as a performance measure and believe it provides useful information to investors regarding our financial condition and results of operations because it offers a direct measure of the operating results of our business segments. Other companies may use different methodologies for calculating NOI, and accordingly, our presentation of the same may not be comparable to other companies. We define NOI for each of our segments as follows:
a) Commercial Offices segment:
NOI for Commercial Offices is defined as revenue from operations (which includes (i) facility rentals, (ii) maintenance services income, (iii) income from finance lease, and (iv) other operating income for Commercial Offices) less direct operating expenses (which includes (i) operating and maintenance expenses including common area maintenance expenses (ii) property taxes, (iii) rent and (iv) insurance).
b) Hospitality segment:
NOI for hospitality segment is defined as revenue from operations (which includes (i) room rentals, (ii) sale of food and beverages, (iii) other operating income from hospitality) less direct operating expenses (which includes (i) cost of materials consumed, (ii) employee benefits expenses, (iii) operating and maintenance expenses excluding property management fees and (iv) other expenses).
c) Other segment:
NOI for other segments is defined as revenue from operations (which includes income from generation of renewable energy) less direct operating expenses (which includes (i) operating and maintenance expenses and (ii) other expenses).
Certain income (such as interest, dividend and other income) and certain expenses (such as other expenses excluding direct operating expenses, depreciation, amortisation, impairment loss and finance cost) are not specifically allocable to segments and accordingly these expenses are adjusted against the total income of the Embassy Office Parks Group.
The table below gives the computation of our NOI and a reconciliation up to EBITDA:
(H in mn)
| Particulars | FY 2025 | FY 2024 | Variance | Variance % |
| Revenue from operations | 40,389.32 | 36,851.82 | 3,537.50 | 10% |
| Less: Property tax | (1,325.25) | (1,197.07) | (128.18) | 11% |
| Less: Repairs & Maintenance (except repairs to building) | (3,594.19) | (3,255.79) | (338.40) | 10% |
| Less: Other direct operating expenses | (2,635.20) | (2,579.49) | (55.71) | 2% |
| Net Operating Income (segment results for the period/ year) | 32,834.68 | 29,819.47 | 3,015.21 | 10% |
| Other operating expenses | (2,370.85) | (2,126.20) | (244.65) | 12% |
| Interest, dividend and other income | 1,423.67 | 2,030.84 | (607.17) | (30)% |
| EBITDA | 31,887.50 | 29,724.11 | 2,163.39 | 7% |
| EBITDA (%) of revenue | 79% | 81% |
Segment-level profitability
(H in mn)
| Commercial offices | Hospitality | Other segment | ||||
| Particulars | FY 2025 | FY 2024 | FY 2025 | FY 2024 | FY 2025 | FY 2024 |
| Revenue from operations | 34,359.91 | 30,906.89 | 5,039.47 | 4,362.71 | 989.94 | 1,582.22 |
| Net operating income | 29,355.07 | 26,260.01 | 2,586.82 | 2,068.80 | 892.79 | 1,490.66 |
| NOI margin (%) | 85% | 85% | 51% | 47% | 90% | 94% |
NOI margins
We were able to maintain our NOI margin at 81% for FY2025 in line with FY2024. During the year, the hospitality sector improved and witnessed a robust performance due to steady domestic demand and an increase in demand from corporate as they ramp up their operations at pre-pandemic level accordingly hotel operating expenses also increased which has resulted in an increase in NOI by 4%.
EBITDA
We use Earnings Before Finance costs, Depreciation, Amortisation, Impairment loss and Tax, excluding share of profit of equity accounted investee (EBITDA) internally as a performance measure. We believe it provides useful information to investors regarding our financial condition and results of operations because it offers a direct measure of the operating results of our business segments. Other companies may use different methodologies for calculating EBITDA and accordingly, our presentation of the same may not be comparable to other companies.
EBITDA does not have a standardised meaning, nor is it a recognised measure under Ind AS and may not be comparable with measures among similar names presented by other companies. EBITDA should not be considered by itself or as a substitute for comparable measures under Ind AS or other measures of operating performance, liquidity or ability to pay dividends. Our EBITDA may not be comparable to EBITDA or other similarly titled measures of other companies/ REITs as not all companies/ REITs use the same definition of EBITDA or other similarly titled measures. Accordingly, there can be no assurance that our basis for computing this non-GAAP measure is comparable with that of other companies/ REITs.
We believe that the comparable Ind AS metric to our EBITDA is profit for the year, and a reconciliation between these two is provided here:
(H in mn)
| Particulars | FY 2025 | FY 2024 |
| Profit for the year | 6,244.36 | 9,640.28 |
| Add: Tax expense | (14,313.94) | 1,250.45 |
| Profit before tax | 1,930.42 | 10,890.73 |
| Less: Share of profit after tax of equity accounted investee | (1,155.25) | (892.11) |
| Add: Depreciation expense | 9,297.97 | 7,572.24 |
| Add: Amortisation expense | 2,117.18 | 2,117.65 |
| Add: Finance costs | 13,286.25 | 10,872.35 |
| Add: Impairment loss | 6,410.93 | (836.75) |
| Earnings before share of profit of equity accounted investee, finance costs, depreciation, amortisation, impairment and tax | 31,887.50 | 29,724.11 |
Net Asset Value (NAV)
We use NAV internally as a performance measure and believe it provides useful information to investors regarding our financial condition. The computation of NAV is prescribed under the REIT regulations.
This computation takes into account the Gross Asset Value (GAV) as arrived at by our independent external property valuers appointed under Regulation 21 of REIT regulations, along with the recorded book values of other assets as well as all other liabilities recorded in the financial statements to arrive at the NAV.
Our Statement of Net Assets at Fair Value as of the dates indicated, at a consolidated level, along with the NAV per unit is set forth here:
Statement of Net Assets at Fair Value
(H in mn)
| Particulars | FY 2025 | FY 2024 | Variance % |
| Gross asset value (GAV) | 611,632.40 | 555,005.26 | 10% |
| Other assets | 50,244.16 | 65,579.39 | (23%) |
| Other liabilities | (260,705.00) | (239,923.84) | 9% |
| NAV | 401,171.56 | 380,660.81 | 5% |
| NAV per unit (J) | 423.22 | 401.59 | 5% |
L.Anuradha in conjunction with value assessment services undertaken by Cushman & Wakefield, carried out our property valuation as an independent valuer and valued the GAV of our portfolio at H611,632 mn with 93% of value from core commercial office segment and with over 75% of value from Bengaluru, underpinning Embassy REITs asset quality as of March 31, 2025.
Asset-wise GAV, along with the key assumptions used in the valuation are provided here:
Valuation Highlights
| Leasable Area (msf) | Valuation Assumptions(1) | GAV(1) as of Mar-25 (J mn) | ||||||||
| Asset | Completed | Proposed/ U/C | Total | Discount Rate Completed | Discount Rate U/C | Cap Rate / EBITDA Multiple | Rent/ADR/ Tariff Rate(5) | Completed | Proposed/ U/C | Total |
| Commercial Offices | ||||||||||
| Embassy Manyata | 12.8 | 3.4 | 16.3 | 11.75% | 13% | 8.00% | 99 | 202,407 | 31,375 | 233,782 |
| Embassy TechVillage | 9.2 | 0.4 | 9.6 | 11.75% | 13% | 8.00% | 97 | 133,944 | 2,956 | 136,900 |
| Embassy GolfLinks(2) | 3.1 | - | 3.1 | 11.75% | NA | 8.00% | 155 | 38,178 | - | 38,178 |
| Embassy One | 0.3 | - | 0.3 | 11.75% | NA | 7.75% | 147 | 5,330 | - | 5,330 |
| Embassy Business Hub | 0.4 | 1.0 | 1.4 | 11.75% | 13% | 8.00% | 68 | 4,295 | 2,376 | 6,671 |
| Express Towers | 0.5 | - | 0.5 | 11.75% | NA | 7.50% | 300 | 20,278 | - | 20,278 |
| Embassy 247 | 1.2 | - | 1.2 | 11.75% | NA | 8.00% | 121 | 19,865 | - | 19,865 |
| FIFC | 0.4 | - | 0.4 | 11.75% | NA | 7.75% | 305 | 15,813 | - | 15,813 |
| Embassy TechZone | 3.0 | 2.4 | 5.5 | 11.75% | 13% | 8.25% | 48 | 22,068 | 2,080 | 24,148 |
| Embassy Quadron | 1.9 | - | 1.9 | 11.75% | NA | 8.25% | 46 | 9,125 | - | 9,125 |
| Embassy Qubix | 1.5 | - | 1.5 | 11.75% | NA | 8.25% | 48 | 9,565 | - | 9,565 |
| Embassy Oxygen | 3.3 | - | 3.3 | 11.75% | NA | 8.25% | 48 | 26,091 | - | 26,091 |
| Embassy Galaxy | 1.4 | - | 1.4 | 11.75% | NA | 8.00% | 48 | 10,549 | - | 10,549 |
| Embassy Splendid TechZone(3) | 1.4 | 3.6 | 5.0 | 11.75% | 13% | 8.25% | 74 | 8,432 | 7,112 | 15,544 |
| Sub-Total (Commercial Offices) | 40.3 | 10.8 | 51.1 | 525,937 | 45,900 | 571,837 | ||||
| Hospitality Assets | ||||||||||
| Hilton at Embassy GolfLinks | 247 Keys | - | 247 Keys | 12.14% | - | 14x | 12,000 | 7,067 | - | 7,067 |
| Four Seasons at Embassy One | 230 Keys | - | 230 Keys | 12.14% | - | 14x | 17,000 | 9,689 | - | 9,689 |
| Hilton and Hilton Garden Inn at | 619 Keys | - | 619 Keys | 12.14% | - | 14x | 5 Star - | 15,865 | - | 15,865 |
| Embassy Manyata | 11,500 | |||||||||
| 3 Star - | ||||||||||
| 7,500 | ||||||||||
| Hilton and Hilton Garden Inn at | - | 518 Keys | 518 Keys | 0.00% | 14% | 14x | 5 Star - | - | 3,497 | 3,497 |
| Embassy TechVillage | 10,000 | |||||||||
| 3 Star - | ||||||||||
| 7,000 | ||||||||||
| Sub-Total (Hospitality) | 1,096 Keys | 518 Keys | 1,614 Keys | 32,620 | 3,497 | 36,116 | ||||
| Others(4) | ||||||||||
| Embassy Energy | 100MW | - | - | 11.75% | - | NA | 6.1 | 3,679 | - | 3,679 |
| Sub-Total (Others) | 100MW | 100MW | 3,679 | - | 3,679 | |||||
| Total | 40.3 msf/1,096 Keys/100MW | 10.8 msf/518 Keys | 51.1 msf/1,614 Keys/100MW | 562,236 | 49,396 | 611,632 | ||||
| %Split | 92% | 8% | 100% | |||||||
Notes:
(1) Represents occupancy as at March 31, 2025 for commercial offices (on completed area basis). Hospitality occupancy and units generated for Embassy Energy are for three months period ended March 31, 2025.
(2) Details include 100% of Embassy GolfLinks except GAV which reflects only our 50% economic interest in Embassy GolfLinks and accounts for only the proportionate profits of Embassy GolfLinks basis the equity method.
(3) Details include 100% of Embassy Splendid TechZone (ESTZ). ESNP is entitled to 61% of lease revenue and 100% of common area maintenance (CAM) in ESTZ. (4) Comprises Solar Park located at Bellary district, Karnataka.
(5) Average blended realised tariff for the quarter ended March 31, 2025.
(6) GAV considered as per March 31, 2025 valuation of the portfolio undertaken by Ms. L. Anuradha, in conjunction with Independent property consultant review services undertaken by C&W. Valuation exercise for the entire portfolio is undertaken semi-annually.
Liquidity and Capital Resources
Overview
Our liquidity position of H8.46 bn and lower Net debt to GAV of 32% clears our pathways towards accelerating growth.
Financial resources
As of March 31, 2025 we had cash and cash equivalents of H6,630.18 mn. Cash and cash equivalents primarily consist of cash on hand; balances with banks in current accounts, escrow accounts and deposit accounts with original maturity below three months. Primarily, our liquidity requirements have been to fund construction and asset upgrades. We expect to meet our working capital and other liquidity requirements for the next 12 months from (i) cash and bank balances; (ii) cash flows from our business operations; (iii) short term and long term loans from banks and financial institutions, we believe that we will have sufficient working capital to fulfil our present requirements for the next 12 months.
This table depicts a selected summary of our statement of cash flows for the periods indicated:
Cash flows
(H in mn)
| Particulars | FY 2025 | FY 2024 |
| Cash generated from operating activities | 30,793.18 | 25,908.96 |
| Net cash flow used in investing activities | (16,530.87) | (11,797.32) |
| Net cash used in financing activities | (17,923.38) | (12,171.39) |
| Net increase/ (decrease) in cash and cash equivalents | (3,661.08) | 1,940.25 |
| Cash and cash equivalents at the beginning of the year | 10,113.73 | 8,173.48 |
| Cash and cash equivalents acquired due to asset acquisition | 177.53 | - |
| Cash and cash equivalents at the end of the year | 6,630.18 | 10,113.73 |
Cash generated from operating activities
Net cash generated from operating activities for FY2025 was H30,793.18 mn. The increase in cash generated from operating activities from H25,908.96 mn to H30,793.18 mn is in line with the growth in net operating income of 10% and EBITDA of 7% in FY2025. Our profit before share of profit of equity accounted investee and tax was H775.17 mn which was adjusted for non-cash items and items relating to financing and investing activities, movement in working capital and taxes paid by a net amount of H30,018.01 mn.
Adjustments to reconcile profit before tax to net cash flows were primarily for depreciation and amortization expense amounting to H11,415.15 mn, finance costs amounting to H13,286.25 mn, impairment loss of H6,410.93 mn and interest income of H876.86 mn.
Working capital adjustments primarily comprised an increase in other financial liabilities (current and non-current) of H1, 803.41 mn, trade payables of H101.60 mn and other liabilities and provisions (current and non-current) of H594.20 mn partially offset by an increase in trade receivables of H408.56 mn and other assets (current and non-current) of H706.59 mn. In addition, we paid income tax of H1,389.69 mn during FY2025.
Net cash flow used in investing activities
Our net cash flow used in investing activities for FY2025 was H16,530.87 mn, primarily due to payment for purchase of investment properties, property, plant and equipment and intangibles including capital work-in-progress and investment property under development amounting to H17,509.73 mn. Such purchases were primarily deployed towards under construction blocks which include Block 8 at Embassy TechVillage, Block L4, D1 and D2 at Embassy Manyata, Block 1, 4 and 10 at Embassy Splendid TechZone, Phase II project at Embassy Hub, capital expenditure spends towards various infrastructure and upgrade projects across our parks and the master plan upgrades at multiple assets. Further we have placed money in fixed deposits amounting to H459.77 mn and invested in debentures of Golflink amounting to H1,800 mn. Such cash outflows were partially offset by cash inflows from the repayment of investment in debentures of H1,144.03 mn and interest received on bank and other security deposits including interest from investment in debentures of GLSP of H1,155.39 mn
Net cash used in financing activities
Our net cash used in financing activities in FY2025 was H17,923.38 mn, primarily due to the repayment of borrowings of H80,040.15 mn, payment of interest on our borrowings of H13,702.65 mn and distributions to our unitholders of H21,374.39 mn, payment of lease liability of H190.15 mn, partially offset by H97,383.96 mn from the proceeds of our borrowings.
Distributions
Under the provisions of the REIT Regulations, Embassy OfficeParksREITisrequiredtodistributetotheUnitholders not less than ninety percent of the net distributable cash flows (‘NDCF) of Embassy Office Parks REIT.
In order to promote standardisation of framework for computing NDCF, a revised framework is defined by SEBI vide master circular no. SEBI/HO/DDHS-PoD-2/P/ CIR/2024/43 dated 15 May 2024. This framework is applicable with effect from 1 April 2024. Accordingly, Embassy Office Parks REIT has computed the NDCF for the quarter and year ended 31 March 2025 to comply with the said circular. In accordance with this circular, Embassy Office Parks REIT along with its SPVs, subject to applicable provisions in the Companies Act, 2013, needs to ensure that minimum 90% distribution of NDCF be met for a given financial year on a cumulative periodic basis.
The aforesaid net distributable cash flows are made available to Embassy Office Parks REIT in the form of (i) Interest paid on Shareholder Debt provided by Embassy Office Parks REIT to the SPVs/Holding Company, (ii) Principal repayment of Shareholder Debt, (iii) Dividend declared by the SPVs/Holding Company and (iv) Proceeds from sale of any Embassy REIT assets.
The Board of Directors of the Manager to the Trust have declared a cumulative distribution of H21.8 bn or H23.01 per unit for FY2025 and cumulative distribution of H120 bn since listing.
Borrowings
During the year, H63,363 mn debt was refinanced at an average interest rate of 7.98%, through a combination of listed debentures, bank loans and commercial paper issuances. Of the total debt refinanced, H39,500 mn of debt was scheduled maturity, which was successfully refinanced at an average rate of 7.93%. Proactively refinanced an additional H23,863 mn of debt with lower rate instruments and achieved 37 bps proforma interest savings. Our net debt book now totals H1,96,554 mn, implying a 32% leverage ratio and a 7.90% in-place cost. Further, 49% of our total debt book is at floating rates and an additional 29% is due for maturity in the next 12 months, which positions us well to take advantage of any rate cuts in the future.
This table presents a breakdown of borrowings as at March 31, 2025 and the corresponding ratios:
Debt analysis
(H in mn)
| Principal Repayment Schedule | |||||||||||||||
| Description | Rating | Fixed/ Floating | Total Facility | Balance Facility | Outstanding Principal | Amortized Cost | Interest Rate | Maturity Date | FY26 | FY27 | FY28 | FY29 | FY30 | FY31 & Beyond | Total |
| At REIT | |||||||||||||||
| Embassy Office Parks REIT Series IV NCD | CRISIL AAA/Stable | Fixed | 3,000 | - | 3,000 | 2,992 | 6.80% | Sep-261 | - | 3,000 | - | - | - | - | 3,000 |
| Embassy Office Parks REIT Series V NCD (Tranche B) | CRISIL AAA/Stable | Fixed | 11,000 | - | 11,000 | 10,978 | 7.05% | Oct-262 | - | 11,000 | - | - | - | - | 11,000 |
| Embassy Office Parks REIT Series VI NCD | CRISIL AAA/Stable | Fixed | 10,000 | - | 10,000 | 9,979 | 7.35% | Apr-273 | - | - | 10,000 | - | - | - | 10,000 |
| Embassy Office Parks REIT Series VII NCD | CRISIL AAA/Stable | Fixed | 10,500 | - | 10,500 | 10,497 | 7.77% | Jun-254 | 10,500 | - | - | - | - | - | 10,500 |
| Embassy Office Parks REIT Series VIII NCD | CRISIL AAA/Stable CARE AAA/ Stable | Fixed | 5,000 | - | 5,000 | 4,999 | 8.10% | Aug-285 | - | - | - | 5,000 | - | - | 5,000 |
| Embassy Office Parks REIT Series IX NCD | CRISIL AAA/Stable | Fixed | 5,000 | - | 5,000 | 4,999 | 8.03% | Sep-256 | 5,000 | - | - | - | - | - | 5,000 |
| Embassy Office Parks REIT Series X NCD | CRISIL AAA/Stable | Fixed | 10,000 | - | 10,000 | 9,998 | 8.17% | Sep-25 | 10,000 | - | - | - | - | - | 10,000 |
| Embassy Office Parks REIT Series XI NCD | CRISIL AAA/Stable | Fixed | 9,000 | - | 9,000 | 9,008 | 7.96% | Sep-27 | - | - | 9,000 | - | - | - | 9,000 |
| Embassy Office Parks REIT Series XII NCD | CRISIL AAA/Stable CARE AAA/ Stable | Fixed | 10,000 | - | 10,000 | 9,986 | 7.73% | Dec-29 | - | - | - | - | 10,000 | - | 10,000 |
| Embassy Office Parks REIT - CP Tranche IV | CRISIL A1+ / CARE A1+ | Fixed | 4,250 | - | 3,982 | 3,982 | 7.75% | Feb-26 | 3,982 | - | - | - | - | - | 3,982 |
| Term Loan | - | Floating | 3,250 | - | 3,250 | 3,228 | 8.35% | Feb-35 | - | - | - | - | - | 3,250 | 3,250 |
| Sub-total (A) | 81,000 | - | 80,732 | 80,647 | 7.71% | 29,482 | 14,000 | 19,000 | 5,000 | 10,000 | 3,250 | 80,732 | |||
| At SPV | |||||||||||||||
| VTPL Series I NCD (Embassy TechVillage | Green Bond) | CRISIL AAA/Stable | Fixed | 4,950 | - | 4,950 | 4,949 | 7.65% | Aug-257 | 4,950 | - | - | - | - | - |
| 4,950 | |||||||||||||||
| MPPL Series I NCD (Embassy Manyata) | CARE AAA/ Stable | Fixed | 10,250 | - | 10,250 | 10,206 | 7.90% | Oct-26 | - | 10,250 | - | - | - | - | 10,250 |
| ECPL Series I NCD (Embassy Business Hub) | CRISIL AAA/Stable | Fixed | 2,500 | - | 2,500 | 2,496 | 8.10% | May-268 | - | 2,500 | - | - | - | - | 2,500 |
| ECPL Series II NCD (Embassy Business Hub) | CRISIL AAA/Stable | Fixed | 2,750 | - | 2,750 | 2,731 | 7.95% | Jan-28 | - | - | 2,750 | - | - | - | 2,750 |
| QBPL Series I NCD (Embassy Quadron) | CARE AAA/ Stable | Fixed | 4,000 | - | 4,000 | 3,980 | 7.80% | Apr-289 | - | - | - | 4,000 | - | - | 4,000 |
| Term Loan (Embassy Manyata) | CARE AAA/ Stable | Floating | 9,000 | - | 8,936 | 8,927 | 7.90% | Feb-39 | 102 | 240 | 287 | 352 | 504 | 7,451 | 8,936 |
| Term Loan (Embassy Manyata) | CARE AAA/ Stable | Floating | 9,200 | - | 9,200 | 9,138 | 7.75% | Sep-39 | 121 | 249 | 315 | 402 | 460 | 7,653 | 9,200 |
| Term Loan (Embassy Manyata) | CRISIL AAA/Stable | Floating | 5,500 | - | 3,750 | 3,729 | 8.50% | May-31 | 71 | 148 | 296 | 713 | 1,134 | 1,389 | 3,750 |
| Term Loan (Embassy Manyata) | CRISIL AAA/Stable | Floating | 5,000 | - | 5,000 | 4,995 | 8.00% | Sep-26 | - | 5,000 | - | - | - | - | 5,000 |
| Term Loan (Embassy Manyata) | CRISIL AAA/Stable | Floating | 3,500 | - | 3,436 | 3,419 | 7.75% | Aug-38 | 55 | 67 | 72 | 107 | 153 | 2,982 | 3,436 |
| Term Loan (Embassy Manyata) | CRISIL AAA/Stable | Floating | 4,500 | - | 4,500 | 4,497 | 7.95% | Jun-26 | 1,000 | 3,500 | - | - | - | - | 4,500 |
| Term Loan (Embassy Manyata) | CARE AAA/ Stable | Floating | 6,300 | 820 | 5,460 | 5,421 | 8.30% | Jun-39 | 66 | 96 | 117 | 170 | 202 | 4,809 | 5,460 |
| Term Loan (Embassy Manyata) | CARE AAA/ Stable | Floating | 5,500 | - | 5,469 | 5,435 | 8.25% | Sep-39 | 72 | 107 | 134 | 176 | 223 | 4,756 | 5,469 |
| Term Loan (Embassy Manyata) | NA | Floating | 5,000 | 3,250 | 1,750 | 1,745 | 8.15% | Mar-40 | 17 | 17 | 17 | 52 | 70 | 1,576 | 1,750 |
| Term Loan (Embassy TechVillage) | CARE AAA/ Stable | Floating | 7,212 | - | 7,212 | 7,207 | 7.86% | Oct-25 | 7,212 | - | - | - | - | 7,212 | |
| Term Loan (Embassy TechVillage) | CARE AAA/ Stable | Floating | 2,000 | - | 1,950 | 1,951 | 8.50% | Oct-25 | 1,950 | - | - | - | - | - | 1,950 |
| Construction Finance (Embassy TechVillage) | CRISIL AAA/Stable | Floating | 6,670 | - | 6,670 | 6,665 | 8.15% | Dec-25 | 6,670 | - | - | - | - | - | 6,670 |
| Term Loan (Embassy TechVillage) | CARE AAA/ Stable | Floating | 2,000 | - | 2,000 | 1,999 | 7.86% | Jun-27 | 20 | 20 | 1,960 | - | - | - | 2,000 |
| Term Loan (Embassy TechVillage) | CARE AAA/ Stable | Floating | 2,000 | 370 | 1,630 | 1,628 | 7.86% | Sep-27 | - | - | 1,630 | - | - | - | 1,630 |
| Term Loan (Embassy TechVillage) | CARE AAA/ Stable | Floating | 4,500 | 2,000 | 2,492 | 2,487 | 8.33% | Oct-39 | 19 | 20 | 44 | 65 | 85 | 2,260 | 2,492 |
| Term Loan (Embassy TechVillage) | CARE AAA/ Stable | Floating | 5,700 | - | 5,650 | 5,611 | 7.90% | Jan-35 | 310 | 370 | 430 | 490 | 550 | 3,500 | 5,650 |
| Term Loan (Embassy Quadron) | CARE AAA/ Stable | Floating | 3,000 | - | 3,000 | 2,999 | 8.50% | Jan-27 | - | 3,000 | - | - | - | - | 3,000 |
| Term Loan (Embassy Oxygen) | CARE AAA/ Stable | Floating | 2,000 | - | 1,970 | 1,981 | 8.00% | Jan-39 | 20 | 20 | 20 | 50 | 94 | 1,766 | 1,970 |
| Term Loan (Embassy Oxygen) | NA | Floating | 7,000 | - | 3,500 | 3,501 | 7.75% | May-25 | 3,500 | - | - | - | - | - | 3,500 |
| Term Loan (Embassy Splendid TechZone) | CRISIL AAA/Stable | Floating | 1,800 | 500 | 1,300 | 1,300 | 8.50% | Sep-26 | - | 1,300 | - | - | - | - | 1,300 |
| Term Loan Embassy Splendid TechZone) | CRISIL AAA/Stable | Floating | 5,500 | - | 5,473 | 5,511 | 8.22% | Jun-39 | 60 | 60 | 60 | 60 | 60 | 5,173 | 5,473 |
| Overdraft Facility (Various) | CARE AAA/ Stable | Floating | 2,925 | - | 2,915 | 2,917 | 8.87% | Multiple | 965 | 1,050 | 900 | - | - | - | 2,915 |
| Sub-total (B) | 1,30,257 | 6,940 | 1,17,713 | 1,17,426 | 8.03% | 27,181 | 28,014 | 9,032 | 6,637 | 3,534 | 43,315 | 1,17,713 | |||
| Total (A+B) | 2,11,257 | 6,940 | 1,98,445 | 1,98,073 | 7.90% | 56,663 | 42,014 | 28,032 | 11,637 | 13,534 | 46,565 | 1,98,445 | |||
1 Embassy REIT has option to redeem all or part of the debentures on a pro-rata basis at any time on a specified call option date (between March 2026 to August 2026) subject to terms of the Debenture Trust Deed
2 Embassy REIT has option to redeem all or part of the debentures on a pro-rata basis at any time on a specified call option date (between April 2026 to July 2026) subject to terms of the Debenture Trust Deed
3 Embassy REIT has option to redeem all or part of the debentures on a pro-rata basis on a specified call option date (October 2026) subject to terms of the Debenture Trust Deed
4 Embassy REIT has option to redeem all or part of the debentures on a pro-rata basis on a specified call option date (March 2025) subject to terms of the Debenture Trust Deed
5 Embassy REIT has option to redeem all or part of the debentures on a pro-rata basis on a specified call option date (February 2028) & (May 2028) subject to terms of the Debenture Trust Deed
6 Embassy REIT has option to redeem all or part of the debentures on a pro-rata basis on a specified call option date (June 2025) subject to terms of the Debenture Trust Deed
7 VTPL has option to redeem all or part of the debentures on a pro-rata basis at any time on a specified call option date (April 2025 to June 2025) subject to terms of the Debenture Trust Deed
8 ECPL has option to redeem all or part of the debentures on a pro-rata basis at any time on a specified call option date (January 2026 to March 2026) subject to terms of the Debenture Trust
9 QBPL has the option to redeem all or part of the debentures on a pro-rata basis at any time on a specified call option date (February 2028) subject to terms of the Debenture Trust Deed
Key leverage metrics
Our key leverage metrics are:
| Particulars | FY 2025 | FY 2024 |
| Net debt to TEV (%) | 36 | 32 |
| Net debt to GAV (%) | 32 | 29 |
| Net debt to EBITDA | 5.36x | 4.9x |
| Interest coverage ratio | ||
| - excluding capitalised interest | 2.6X | 2.8X |
| - including capitalised interest | 2.2X | 2.4X |
| Available debt headroom (H in bn) | 100 | 106 |
We continue to maintain a strong liquidity position of H8.46 bn and a low leverage of 32% Net Debt to Gross Asset Value (GAV). Considering our dual AAA credit rating, additional proforma headroom of H100 bn and our ability to raise debt at competitive rates, we are in a strong position to pursue growth through on campus development and accretive acquisitions.
Capital expenditures and capital investments
Historical capital expenditure
Capital expenditure comprises additions during the year to property, plant and equipment, capital-work- in progress, investmentpropertyandinvestmentpropertyunderdevelopment.
In FY2025, we incurred capital expenditure of H17,509.73 mn, primarily towards (a) construction of blocks which include Block 8 at Embassy TechVillage, D1, D2 and L4 at Embassy Manyata, Block 1, 4 and 10 at Embassy Splendid TechZone, Phase II at Embassy Hub (b) capital expenditure spendings towards various infrastructure and upgrade projects across our parks and the master plan upgrades and leasing area upgrades at various assets (c) fit-outs expenditure at Embassy Manyata, Embassy Oxygen and Embassy One.
Planned capital expenditure
This table presents the development status and balance costs to be spent for development projects in progress as at March 31, 2025.
Development in Progress(1)
| Projects | Development | ||||||
| Asset | Completed | Area (msf) | Keys | Pre-committed/ Leased(2) Area (%) | Occupier(3) | Estimated Completion Date | Balance cost to be spent (H mn) |
| Base-Build Projects (Completed) | |||||||
| Embassy TechVillage | Block 8(4) | 1.9 | NA | 87% | Multi-tenanted | Completed | 2,265 |
| (Primarily by GCCs) | |||||||
| Sub-total | 1.9 | 87% | 2,265 | ||||
| Base-Build Projects (Under | |||||||
| Construction) | |||||||
| Embassy Splendid TechZone | Block 10 | 0.4 | NA | - | - | Jun-25 | 828 |
| Embassy Splendid TechZone | Block 4 | 0.6 | NA | - | - | Jun-25 | 1,113 |
| Embassy Manyata | Block L4 | 0.8 | NA | 100% | American Retailer | Sep-25 | 1,077 |
| Embassy Manyata | Block D1 & D2 | 1.4 | NA | 67% | Australian Bank(5) | Feb-26 | 3,872 |
| Redevelopment | |||||||
| Embassy TechVillage | Hilton Hotels | NA | 518 | NA | NA | Oct-26 | 6,734 |
| Embassy Splendid TechZone | Block 1 | 0.6 | NA | - | - | Jun-26 | 1,940 |
| Embassy TechVillage | Block 6 | 0.4 | NA | - | - | Jun-27 | 1,847 |
| Embassy Manyata | Block B | 0.9 | NA | 71% | Global Bank(6) | Jun-27 | 5,122 |
| Redevelopment | |||||||
| Embassy Business Hub | Phase 2 | 1.0 | NA | - | - | Sep-27 | 5,872 |
| Sub-total | 6.1 | 518 | 39% | 28,406 | |||
| Infrastructure and Upgrade | |||||||
| Projects(7,8) | |||||||
| Embassy Manyata | F2 Refurbishment | NA | NA | NA | NA | Completed | 184 |
| Embassy Manyata | G1 Refurbishment | NA | NA | NA | NA | Completed | 112 |
| Embassy Manyata | H1 Refurbishment | NA | NA | NA | NA | Mar-26 | 1,338 |
| Embassy Qubix | IT1 Refurbishment | NA | NA | NA | NA | Completed | 29 |
| Embassy TechVillage | Metro Works | NA | NA | NA | NA | Mar-27 | 750 |
| Embassy Business Hub | Food Court | NA | NA | NA | NA | Completed | 62 |
| Embassy Splendid TechZone | Master Plan Upgrade | NA | NA | NA | NA | Mar-27 | 1,182 |
| Others | Various | NA | NA | NA | NA | Various | 2,872 |
| Sub-total | NA | NA | NA | 6,528 | |||
| Total (Under Construction) | 6.1 | 518 | 39% | 37,199 | |||
Notes:
(1) Excludes Embassy GolfLinks as it is a portfolio investment
(2) Excludes all expansion options available to the occupier
(3) Actual legal entity name may differ
(4) Occupancy Certificate for Block 8D received in Q3FY2025 and for remaining blocks (Block A,B and C) was received in Q4FY2025
(5) Expansion Option of 453k sf available, which when exercised will result in 100% precommitment on the building
(6) Expansion Option of 250k sf available, which when exercised will result in 100% precommitment on the building
(7) Over the next 3 years
(8) Includes select infrastructure and upgrade projects across the portfolio such as Solar Rooftop, Lobby upgrades, Food Court, Refurbishments amongst various others
Off-balance sheet arrangements and contingent liabilities
We do not have any material off-balance sheet arrangements. The table below sets forth our contingent liabilities as of March 31, 2025:
Off-balance sheet arrangements and contingent liabilities
(H in mn)
| Particulars | FY 2025 | FY 2024 |
| Claims not acknowledged as debt in respect of Income Tax matters | 96.79 | 276.07 |
| Claims not acknowledged as debt in respect of Indirect Tax matters | 661.05 | 707.36 |
| Claims not acknowledged as debt in respect of Property Tax matters | 3,124.96 | 3,418.89 |
Risk Management
We are the owner of a high-quality office portfolio in India that serves as essential corporate infrastructure
to multinational tenants and has significant embedded growth prospects. The growth of domestic companies has resulted in robust demand for commercial office space and strong growth across Indias major office markets. We are highly dependent on the prevailing economic conditions in India and our results of operations are significantly affected by factors influencing the Indian economy. Further, the real estate sector in India including REITs is heavily regulated. We are also subject to environmental, health and safety regulations in the ordinary course of our business. These and many other factors might affect our business, results of operations or financial condition. We are committed to maintaining our strong corporate governance standards and have a robust risk management framework in place to address risks that arise from the economic, operational, social and environmental ecosystems that we operate in.
The Board of Directors of the Manager of Embassy Office Parks REIT has overall responsibility for the establishment and oversight of the Embassy Office Parks Groups risk management framework. The Embassy Office Parks Groups risk management policies are established to identify and analyse the risks faced by the Group, to set appropriate risk limits and controls and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Groups activities. The Board of Directors of the Managers of Embassy Office Parks REIT oversees how management monitors compliance with the Groups risk management policies and procedures and reviews the adequacy of the risk management framework in relation to the risks faced by the group. The Audit Committee is assisted in its oversight role by internal audit. Internal audit undertakes both regular and ad hoc reviews of risk management controls and procedures, the results of which are reported to the Audit Committee.
Internal financial control systems
Embassy REIT has a strong internal financial control system to manage its operations, financial reporting, and compliance requirements. The Manager has clearly defined roles and responsibilities for all managerial positions. These responsibilities include the design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the orderly and efficient conduct of its business, including adherence to the Companys policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial information. All business parameters are regularly monitored, and effective steps are taken to control them.
Embassy REIT has appointed one of the Big4 firms to conduct internal audit of its activities. The internal audit plan is reviewed each year and is approved by the Audit Committee. The internal audit is focused on review of internal controls and operational risk in the business of Embassy REIT. Embassy REIT takes a proactive approach to risk management, making it an integral part of our business both strategically and operationally. Our objective is optimisation of opportunities within the known and agreed risk appetite levels set by our Board. We take measured risks in a prudent manner for justifiable business reasons. Our ERM framework encompasses all our risks such as strategic, operational, and compliance risks. Appropriate risk indicators are used to identify these risks proactively. A robust internal control system and an effective, independent review and audit process underpin our ERM Framework.
While management is responsible for the design and implementation of effective internal controls using a risk-based approach, external consultant reviews such design and implementation to provide reasonable assurance on the adequacy and effectiveness of the risk management and internal control systems. The Audit Committee and the Board of Directors periodically reviews the adequacy and effectiveness of internal financial control systems and suggests improvements to further strengthen them. The internal financial control systems are adequate and operating effectively as at March 31, 2025. The effectiveness of the internal control over financial reporting for each of the SPVs as at March 31, 2025 has been attested by the respective statutory auditors of SPVs who expressed an unqualified opinion on the effectiveness of each SPVs internal control over financial reporting as of March 31, 2025.
IIFL Customer Care Number
(Gold/NCD/NBFC/Insurance/NPS)
1860-267-3000 / 7039-050-000
IIFL Capital Services Support WhatsApp Number
+91 9892691696
Download The App Now
Follow us on
2026, IIFL Capital Services Ltd. All Rights Reserved
IIFL Capital Services Limited - Stock Broker SEBI Regn. No: INZ000164132, PMS SEBI Regn. No: INP000002213,IA SEBI Regn. No: INA000000623, SEBI RA Regn. No: INH000000248, DP SEBI Reg. No. IN-DP-185-2016, BSE Enlistment Number (RA): 5016
ARN NO : 47791 (AMFI Registered Mutual Fund & Specialized Investment Fund Distributor), PFRDA Reg. No. PoP 20092018
This Certificate Demonstrates That IIFL As An Organization Has Defined And Put In Place Best-Practice Information Security Processes.
